The Asian Development Bank (ADB) will provide $300 million to support the Philippine government roll out services aimed at assisting Filipino youth find gainful employment, part of the government’s job creation goal under the Duterte government’s 10 point agenda and 2017-2022 Philippine Development Plan.
The policy-based loan was approved today by the ADB Board of Directors as the first phase of the Facilitating Youth School-to-Work Transition Program being implemented by the Department of Labor and Employment in collaboration with other government agencies and cities and municipalities in Luzon, Visayas, and Mindanao.
“The Philippines has a young population with an average age of 25 years,” said Kelly Bird, Director for Public Management, Financial Sector, and Trade Division of ADB’s Southeast Asia Department. “Therefore, creating wage jobs for youth is vital to reducing poverty and income inequality.”
Despite the Philippines’ rapid growth averaging an annual 6.3% between 2010 and 2016 and with it a solid improvement in the job market, the country continues to have a youth employment problem stemming from a slow school-to-work transition. Based on an ADB study, only one out of five high school graduates in Metro Manila and Cebu City found a job within a year of leaving school. In 2013, one in four young persons was not in employment, education, or training — a rate second only to Indonesia in Southeast Asia.
The government has identified several constraints in the Filipino youth’s transition to work after school, including inadequate and underfunded government employment services and weaknesses in post-high school training.
In response to these constraints, the Philippines enacted a new law in 2015 that mandated the institutionalization of public employment services offices (PESOs) in local governments and secured funding for them. The government also passed amendments to the Special Program for the Employment of Students Act that provides paid internships to poor students to keep them in college. It also enacted a law institutionalizing and funding the nationwide roll-out of the JobStart Philippines Program that provides skills training and internships to out-of-school youth to raise their chances of productive employment.
The program will include a series of government policy actions to raise the youth employment rate. It will support the government’s efforts to restructure its PESO and labor market activation programs and roll out new services to assist youth and strengthen training and apprenticeship programs.
